Suppliers will receive 33.5c/L, based on standard constituents of 3.3pc protein and 3.6pc butterfat, inclusive of sustainability and quality bonuses and VAT. The August milk price equates to an average farm gate milk price of 39.4c/L, based on average August milk solids, achieved by suppliers.
The milk price for August, based on EU standard constituents of 3.4pc protein and 4.2pc butterfat is 36.6c/L. A spokesperson commented: “Global milk markets continue to weaken due to pressure on demand in key markets, with no sign of a near-term correction.
“Dairygold remains focused on paying the strongest milk price possible and has maintained this approach since the start of the year. “The current market conditions are likely to keep milk prices under pressure until the supply-demand imbalance is corrected. The Dairygold Board will continue to closely monitor markets and review milk prices on a month-by-month basis.”
The cut comes in the wake of a series of milk price reductions this year and after news last week that Ireland’s Nitrates Derogation, relied upon by many dairy farmers, will be cut from next year. Tirlán also announced a sharp cut to its milk price for August supplies. The processor will pay a total of 33.08c/L (including VAT) for August creamery milk supplies.
Tirlán Chairperson John Murphy said inflation, higher interest rates, and ongoing destocking continue to affect buyer behavior. “Strong domestic milk production in China and weaker economic data from that region have also negatively impacted market sentiment. The margin pressures facing milk suppliers in most parts of the world are likely to curb global milk supply, although the timing remains uncertain,” he said.
Kerry Group said its milk price for August milk supplies would be 35c/L (Vat Inc) consisting of a base price of 32c/L (Vat Inc) and a Milk Contract payment of 3c/L (Vat Inc) on all qualifying milk volumes. Based on Kerry’s average milk solids for August, it said the milk price return inclusive of VAT and bonuses is 39.80c/L. Kerry said the short to medium-term outlook on commodity dairy continues bearish with little sign of any demand-side correction in the offing.
